TMI Blog1964 (1) TMI 72X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 31,000 in the account years relevant to the assessment years 1949-50, 1951-52 and 1952-53. The Income-tax Officer started proceedings under section 34 in the view that these amounts brought into the taxable territories cam out of the profits from business carried on in the Fiji Islands. The contention of the assessee was that these amounts represented remittances out of capital. But this contention was repelled and assessments were made. An appeal was taken to the Appellate Assistant Commissioner, before whom the assessee pleaded that it was impossible for him to furnish particulars of his income from 1932 onwards. He claimed that he had converted the profits into capital assets and that what he brought into the taxable territories ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, on the facts and in the circumstances of the case, the Tribunal was justified in law sustaining the assessment made on the assessee as remittances to the taxable territories out of the business profits made by the assessee in Fiji Islands, 1949-50, ₹ 6,643 plus ₹ 2,657, 1951-52, ₹ 24,704 and 1952-53 ₹ 27,500 plus ₹ 3,551 ? It is not disputed that the petitioner was employed in a firm between 1922 and 1931. Thereafter, he appears to have set up independent business and carried it on till 1938, when he sold that business to Messrs. Indian Trading Company. He served that company as a manager till 1944. From 1944 onwards he worked as a receiver in another company. In 1939, he built a house at a cost of pou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ength of time, is it too much to infer that there assets for considerable length of time, is too much to infer that there was a real intention to convert the money into capital ? We cannot see how any other inference can be justify drawn from the circumstances of the case. Mr. S. Ranganathan, learned counsel for the department, has referred to Walls v. Randall. That was a case where the appellant had two sources of income abroad, dividends on investments in India and his share of profits as a sleeping partner in a firm carrying on business in Calcutta. The income from both these sources was paid into his bank accounts in Calcutta. Out of these amounts, he directed that a sum of pounds 10,000 should be forwarded to him in England in the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome in the purchase of mill stores and machinery in England and brought the articles to India and used them for the purpose of their mills. The question was whether this sum was income which was brought to British India and therefore assessable. The High court held that it was not received in or brought to British India and there was no liability to income-tax. This decision was affirmed by the Privy council. The principle is amply illustrated by the headnote which reads thus : If income arising or accruing without British India is spent or otherwise so dealt with that it ceases to be income instead of being brought into British India, it is not chargeable under the Act merely because the thing upon which it has been expended or into w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts earned in Trivandrum outside British India, the assessees purchased Mysore securities and kept them at Trivandrum. In order to effect a change in the mode of investment, the securities were sold to a firm at Trivandrum. That firm entered into a contract at Madras to sell those securities to a broker at Bombay. The Mysore securities were brought to Madras and then forwarded to Bombay. The assessees were credited with the sale proceeds of the mysore securities. The income-tax department claimed that there was a remittance to British India of unassessed foreign profits. This court took the view that the securities represented capital, as the accumulated foreign profits had been so capitalised when the securities were purchased. There was no ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
